Zillow Shares Could Fall By Half

Merging real estate Websites Zillow and Trulia isn't the sure winner bulls contend. Time to put a "For Sale" sign on the stocks.

Some major Internet stocks have stumbled this year, but shares of residential real estate Website Zillow have soared about 70%. And thanks in part to a merger announcement on July 28, so have those of its former rival, Trulia. Tens of millions of Americans regularly tour the two sites hunting for the perfect home or keeping tabs on what their neighbors' houses are worth. Bulls have dubbed the planned combination Godzulia, imagining that the two sites will grab a big piece of the $10 billion that realtors spend annually on advertising. Zillow's all-stock deal reflected this optimism, valuing Trulia at $3.5 billion, a...